4/30/2015

GIC is my model fund management company


Phillip And wrote an article in his blog titled ‘Should GIC invest our CPF in a company after its share price quadrupled?’ He raised the question based on a number of reasons. I just quote this one,

‘GIC has paid for a business which was worth only a quarter of the price less than a year ago. Its purchase price of Rs 222 valued Nirlon at US$316 million when the market had earlier valued it at below US$80 million.’

I think any layman would also find this outrageously funny or even stupid. Why not buy it when it was Rs 50 but only after its price quadrupled to Rs 222. Isn’t this a perfect example of the market joke, buy high and sell low for losers?

I must disagree. People not in the industry of trading stocks always think it this way. But from my 20 years of experience, this is called play safe strategy. Do not buy a stock until one is sure that its price is up and confirmed up. In this case the price has quadrupled, which means it has confirmed going up and the uptrend is very strong.

Normally I would play safe and buy when the price is double. To me when the price is up 4 times is like playing safe 4 times safer. This is obviously a very conservative strategy. Look, when you are gambling with OPM, you cannot anyhow buy. You buy only when you are sure, very sure, double confirmed, triple confirmed and better still quadruple confirmed.

Fund managers adopting a ‘quadruple confirm strategy’ are very careful fund managers. I regretted that I did not follow this strategy. I always buy when the price has doubled. And you know what happened, I lost my pants. If I have known of this strategy, I would have made just as much money as GIC. Look at its past records, it is making profits practically every year, sometimes more sometimes less, but still profits. I did not follow this strategy, that is why I have been making losses all the time.

I am now watching and learning from this GIC strategy and learning a lot from it. Buy high, go higher! You see, when the price of a stock has gone up so high, it can only go higher. Now I am trying to start a fund to invest using this formula. This kind of strategy needs a lot of patience and homework. There are not many stocks that would have gone up 4 times in a year, or in 50 years. The chosen stock Nirlon is a rare gem. This kind of buys sure to make money one.

And better still if it is an Indian company. Indian companies are growth companies. There are 1.3b people there and growing. Soon India will have more people than China. Use the same logic, China’s population is 1.4b and many of its companies are growing and very profitable. The Chinese banks are the biggest in the world in capitalisation. Alibaba is one of the most successful IPO listing in New York. Indian companies would follow the path of these Chinese companies and would do better as they have more super talented banking and finance talents. They would out do Chinese companies in a matter of time. A caveat, unless all their top talents are in US or overseas, like in Singapore.

I ‘pai seh’ to tell Phillip Ang he did not know what he was saying. If GIC is a 3rd World SWF, you can bet something is not right. The analysts, the person who approved the buy and the board to concur, everyone must have a cut in this dubious acquisition. But GIC is a Singapore SWF managed by honourable people and with many layers of checks and controls. The decision must be make very carefully and it must be a good decision and the timing must be just right. The GIC is very professionally managed by the best talents money can buy. Period.

I like GIC, my favourite company, when investing strategy is concerned. Always make money one. Anyone wants to invest in my fun, oops I mean fund? I guarantee them sure make money using the same formula as GIC. Buy high and the price will go higher. And buy India, the most promising country for growth. The prices would not only quadruple, but could go up many more times.

My advice to Phillip Ang, don’t worry, be patient. Time will tell. Think long term. Remember CECA? If India is not such a good bet, the govt would not have signed CECA with India, a win win agreement. We laymen, outsiders, did not know how much thought processes, planning and homework have been put in before the decisions were made to invest in India and to sign CECA. You can blame them on anything but not on due diligence and expertise.

16 comments:

Anonymous said...

Who is this Philip Ang?

If he thinks he is smarter than those GIC investment managers, why then is he not one of them?

And as a blogger and if he really wants to be taken seriously, why did he not even want to introduce himself and his background like RB did? Is he even using his real name?

Anonymous said...

Hey Temasek.
The Shanghai and Honk Kong stock markets are going parabolic right now (going up steeply).
There must be plenty of good opportunities there.

Anonymous said...

One thing for certain, this Phillip Ang did not lose $100b of public money.

You can do better than that?

Anonymous said...

Many moons ago, attended talks on investment in shares. Golden words/principles were used........

don't know don't buy......
buy low sell high.......
buy high sell higher......
accumulate........
sell some hold some........
buy some more for averaging.....
don't do anything......
when aunties and uncles start to buy you sell.......
and many many many more..........

The strategy to buy into a company when its share price had quadrupled, maybe following the golden words/principle of "BUY HIGH AND SELL HIGHER"!

Good! Good! Good! Just follows the golden words! No Mistake! No Mistake!

Anyway, nothing is 100% in share investing!

发 发 发 ! 发 发 发 !

Enjoy the long weekend!

Cheers.

Anonymous said...

Buy High.
Sell Higher.
Greater Fool Theory Anyone?
Whose the biggest fool in Singapore?
Temasek or Singapore voters?

The said...

That was what Temasek did - it bought into Shin Corp after the share price has gone up steeply. The rest is history and so is Thaksin.

☝︎Matilah_Singapura ☟ ☟ ☟ said...

If I put on my Austrian School libertarian hat for this issue, then I will have to say that both the GIC and CPF should be dismantled.

All CPF money then are returned to the members. Every penny---not this account that kwa simi lanciao medisave account---none of that. Every last penny goes to each individual to the total value of their contribution, plus interest accrued.

All the GIC money gets divided up and returned to the taxpayers according to their last 2-3 years tax returns.

Anything left over from the GIC and CPF funds go to paying back Singapore's EMBARRASING PUBLIC DEBT [1] | [2].

No more borrowing "cheap" from CPF members and paying them SHIT interest and then making huge amounts of money by the govt investing in the private sector. govt cannot be allowed to operate in the private sector!!---it is just fraught with Moral Hazards and unintended consequences,
negative externalities, and one can't even begin to imagine the entangled maze of conflicts of interest.

If there's anything leftover after all that---and I wouldn't be surprised as Sg.gov is damn good at getting money and keeping it---then "park" it in a safe fund of solid assets only---like precious metals, and land. No taking risks by buying "distressed" companies here and there. Fuck you GIC, you are not Warren Buffet lah!

The excess funds are parked safely until sometime when it can be used to upgrade the infrastructure---like, replacing certain parts of the old MRT system, or developing the southern islands perhaps for eco-friendly solar power or wind turbines....or build an experimental thorium reactor, or a smart electrical grid. Plenty of stuff to do, which benefits everyone lah.

Going down lah! ↴
⬇︎
⬇︎
⬇︎
⬇︎

Anonymous said...

Why do we have Temasek and GIC?
Why not just buy Berkshire Hathaway shares?
Buy Berkshire Hathaway shares and we get Warren Buffet as the investment manager and CEO for free.
Continue giving money to Temasek and we get Ho Ching as CEO.

True or not?
I dunno.
You tell me lah.

Anonymous said...

Why not just buy Berkshire Hathaway shares?
Anon 11:10 a.m.

Then Ho Ching do what, u tell me lah?

☝︎Matilah_Singapura ☟ ☟ ☟ said...

Just look at foreign reserve holdings (USD):

China: 3.9 trillion (10^12) Population: 1.3 billion (10^9)

Singapore: 240 billion (10^9) Population: 5.4 million (10^6)

Amount of foreign reserves per capita:

China: USD 3000
Singapore: USD 44,444 (si si si si...die die die :-))) to all you superstitious shitheads

Are you telling me that the govt should hold so much money? How about they give you that 40 grand so that you can buy your own Berkshire shares, or spend it on a grand Asian sex tour---Geylang, Thailand, Manila, China...fuck until face look like cheebye? ;-)

Anonymous said...

Then Ho Ching do what, u tell me lah?
April 30, 2015 11:22 a.m.

Given the investment track record of Temasek;
It may be less costly just to pay Mdm Ho Ching $5million/year just to do nothing.
True or not?

b said...

Maybe they threaten to disclose a photo of Lee XX making out with some Bollywood bimbo? Sometimes, things are actually very simple.

Whiter Than White Bean said...

Red Bean,

GIC so good one, hah?

How come I don't know one?
All I know, which was made known to us, was that GIC lost many billions during the Financial Crisis. Some more at that time the Chairman was none other than the Pee-AIM's Papa hor?

May be I am too daft to know all their due diligence done behind the curtain, or behind closed doors, or inside the cupboards?

Anonymous said...

RB,

Did you watch the Youtube. Someone was sent to attack the kid Amos Yee physically right outside the Court Yard. THere were so many reporters there and none of them even had the moral duty to give chase to that man who assaulted Amos, nor did any of them even used their cameras to take pictures of video of theat man's face in order to give evidence to the Police later.

Bloody shame to Sinkies Reporters, probably from SPH Groups???

Virgo 49 said...

If that chow ah kwa is offended by what others said of his GOD, then it shown what sort of GOD he is worshipping.

Anonymous said...

Who beat Amos? Who beat Amos? He is so lucky, his coo coo bird still there right? He better be grateful.

If this has not struck fear into anyone, don't know what will be the next thing to happen to Amos?